Growth rate slows Arizona's recovery

by Betty Beard - Sept. 8, 2010 12:00 AMThe Arizona Republic

Some people are heading to places where jobs are more plentiful. Some are just leaving Arizona because of the tough stance on immigrants. Others, as is typical in hard times, are simply heading "home."

Although population trends appear to be more positive than in 2008 and '09, Arizona's once-high-flying growth rate continues to be anemic and will probably remain so for years, according to the latest utility projections, data from moving companies and other sources.

The state appears to be gaining a tad more people than it's losing, even with 6,300 fewer jobs in July than a year earlier, according to the U.S. Labor Department, and the departure of many Hispanics in the wake of SB 1070.

Among those leaving are Eva Knight, a former Sun City resident who moved about a week ago to Colorado because she got tired of the heat and wants to be closer to friends and family. "Family becomes everything when you are older," she said, adding, "There is something about my Scandinavian genes that goes into revolt whenever the heat sets in."

The state's growth rate this year appears to be only about 1 percent and likely includes many babies.

Slow growth means fewer people are available to buy up the state's excess housing inventory and reduces the pace at which new homes can be built. It means Arizona will take longer to recover from the recession.

State population counts from the 2010 census will be released in December.

Arizona Public Service Co., the state's largest utility, projects a 1 percent increase in its customers from 2010 to 2012. Elliott D. Pollack & Co. in Scottsdale also projects a 1 percent population increase this year and a 2 percent increase in 2011.

Brian Cary, an economist with Salt River Project, the largest utility in the Phoenix area, said the company's projections are in line with those of APS.

"Our customer growth has been just at or under 1 percent annualized, which actually is an improvement from a year ago when our customer base was scarcely growing at all," he said.

Cary said he does not expect any sharp rebound in the state's growth rate soon.

What numbers show

Arizona was once the envy of other states because it was growing so fast. In the 1990s, the state ranked second in the nation behind Nevada with a 40 percent population growth, according to the U.S. Census Bureau. From 2000 through 2009, Arizona ranked fifth with 29 percent growth. Its population was estimated at 6.6 million in July 2009.

Data from utilities and moving companies, along with information on auto registration and surrendered license plates, illustrate a state that is attracting fewer new residents.

Customer growth at APS was only 0.6 percent in the first six months of the year, compared with the same period last year. SRP recorded a 0.8 percent increase through July. Cary cautioned that electrical hookups measure only occupied households, not necessarily population increases. Foreclosures and job shortages may have prompted many people to double up and stopped college and high-school graduates from moving away from their parents, he said.

Phoenix-based U-Haul International, which caters to do-it-yourself movers, has seen its Phoenix-area moving business increase about 8 to 10 percent this year through July, said J.T. Taylor, company president. But most of those moves are within Arizona, such as from Tucson to Phoenix.

The number of people who used U-Haul services to leave the state exceeded those who moved in by almost 1 percent. Taylor said the number of trucks and trailers arriving have been fairly equal to the number leaving.

But nationwide, the company is seeing more people on the move, with about a 12 percent growth over last year.

"Last year was brutal, and the year before was off. We are in between two to three years ago in the type of numbers we are seeing," he said.

"From an economic standpoint, that is fairly exciting."

Although no one has said Arizona's population has shrunk, the number of vehicles appears to be fewer, easing traffic congestion.

The total number of vehicle registrations has fallen for the past three fiscal years, from a peak of 5 million in 2006-07 to 4.8 million in 2009-10, according to the Arizona Department of Transportation. Vehicles can be registered more than once a year because of ownership changes.

Surrendered license plates, another statistic that roughly correlates with the rise and fall of population, fell 4 percent from 2008 to 2009.

That shows the number of motorists who turned in licenses from other states to get Arizona plates.

Why they are moving

Cary said the main reason population growth has been slow and people have left is because the number of jobs peaked in 2007 and has been falling since.

And although Hispanics have said they are leaving or know people who have left because of Arizona's new immigration law, Cary said there is no hard data to show how many have left for that reason. There are other reasons people leave, too.

Neal Wetzel, sales manager for a Two Men and a Truck franchise, goes to people's houses to estimate the cost of moving their goods and hears firsthand why many choose to leave.

"A lot of people are pulling up and going back to where they came from originally," he said. "We're taking people back to Michigan, for God's sake, where the unemployment rate is higher than it is in Arizona."

He believes that in times of crisis, people just want to go back home, back to happier times, to relatives and friends they grew up with. Or maybe they have a relative who is aging. And they are not being kept here by jobs.

"I have heard that story so much that they going back to their old stomping grounds," Wetzel said.